A study by Landmark Properties has predicted that rents for apartments in Dubai will drop by 25 percent and villas by 23 percent. The report comes just days after the managing director of the Dubai Real Estate Institute (DREI) predicted rents would fall by up to 25 percent over the next 18 months. Dr Salem Al Shafiei also predicted that layoffs among sales and marketing staff in the real estate sector were likely to continue during 2009.
 
The Landmark Properties study added that in Abu Dhabi, rents were likely to remain “relatively stable” during the first half of the year or see “marginal declines”. Jesse Downs, Landmark Advisory’s head of research, told the paper several factors had caused the capital’s average rents to “hit a ceiling”.

“Residents simply could not afford to pay higher prices,” she said.
 
In a recent report, US bank Morgan Stanley said rents in Dubai were down seven percent in December from a peak last summer, while the cost of renting villas had declined 10 percent.
 
Last month property services firm Asteco said rents in Dubai and Abu Dhabi were flat in the final quarter of 2008.